Do Neighbors Help Finding a Job? Social Networks and Labor Market Outcomes After Plant Closures

Elke Jahn and Michael Neugart

No 10480, IZA Discussion Papers from IZA Network @ LISER

Abstract: Social networks may affect workers' labor market outcomes. Using rich spatial data from administrative records, we analyze whether the employment status of neighbors influences the employment probability of a worker who lost his job due to a plant closure and the channels through which this occurs. Our findings suggest that a ten percentage point higher neighborhood employment rate increases the probability of having a job six months after displacement by 0.9 percentage points. The neighborhood effect seems to be driven not by social norms but by information transmission at the neighborhood level, and additionally by networks of former co-workers who also lost their jobs due to plant closure.

Keywords: plant closures; wages; employment; neighborhood; job search; social networks (search for similar items in EconPapers)
JEL-codes: J63 J64 R23 (search for similar items in EconPapers)
Pages: 37 pages
Date: 2017-01
New Economics Papers: this item is included in nep-lab, nep-soc and nep-ure
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

Published - substantially revised version in: Labour Economics , 2020, 65, 101825,

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Related works:
Journal Article: Do neighbors help finding a job? Social networks and labor market outcomes after plant closures (2020)
Working Paper: Do neighbors help finding a job? Social networks and labor market outcomes after plant closures (2020)
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